Proposed Merger Between Fantasy Sports Companies DraftKings and FanDuel Being Blocked For Antitrust

thefinanceguy (63)in #money • 7 years ago

The Federal Trade Commission announced yesterday that they would be moving to block the proposed merger between Draftkings Inc and FanDuel. They claim that these two fantasy sports companies would have 90% market share if they combined, and that this would be bad for the consumer who would have less choice.

Let me be very clear, I think blocking this merger is beyond pointless, as is all antitrust legislation. The antitrust laws benefit the biggest and most crony companies out there, at the expense of the smaller companies, which is the opposite of what the laws are supposed to do. In a true free market with free competition, a natural monopoly couldn't possibly happen. If anyone can compete with anyone, then one company wouldn't be able to monopolize anything unless they used outright force and coercion(as the state does). On a moral basis, if one group, company, or club wants to voluntarily merge with another, then who has the right to say otherwise? Why should the voluntary unification between groups of individuals be subject the violence of the state?

Below is a very informative video featuring economics professor Dominick Armentano and a very young congressman Ron Paul discussing the issue of antitrust.

If you're interest in further reading on this subject, I would highly recommend Armentano's book "Antitrust: The Case For Repeal" which can be found for free at the link below.
https://mises.org/library/antitrust-case-repeal

I find it rather hypocritical that the government is even involved in breaking up monopolies, when the state itself in nothing more than a centralized monopoly on violence and coercion. Too bad that kind of monopoly won't be breaking up any time soon. In the meantime, fantasy sports consumers will surely be thanking the FTC for keeping the voluntary merger at bay.